China woos top Western companies as foreign investment slumps

HONG KONG: China wooed a number of top Western companies with renewed promises to open up its financial industry and create a more welcoming environment as Beijing tries to reverse a record low in foreign investment in the face of mounting economic challenges, the media reported.

Pan Gongsheng, governor of the People's Bank of China (PBOC) and head of the country’s foreign exchange regulator, chaired a symposium with representatives from foreign companies, including JP Morgan, Tesla, HSBC, Deutsche Bank, BNP Paribas, Japan's MUFG Bank, German chemical producer BASF, commodities trader Trafigura and Schneider Electric, according to a post on the websites of the PBOC and the State Administration of Foreign Exchange (SAFE), CNN reported.

The symposium was intended to "increase financial support to help stabilize foreign trade and foreign investment” and improve the “investment environment" for foreign business, the statement said.

Foreign companies and investors have grown wary of rising risks in the world’s second largest economy, including a worsening slowdown marked by weak domestic demand and a housing crisis, Beijing's desire to prioritise national security over economic growth and deteriorating relations between China and many Western countries, CNN reported.

In the first eight months of this year, foreign direct investment (FDI) into China fell 5.1 per cent from a year ago, according to data released by China's commerce ministry on Sunday.

A separate measure for foreign investment painted a grimmer picture.

Direct investment liabilities, a measure of FDI reflected in a country’s balance of payments, fell to just $4.9 billion in the April to June months, down 87% from a year earlier, according to data published by SAFE last month. That was the lowest amount in any quarter since records began in 1998, CNN reported.